This episode contains segments on:

• China’s renewed calls for attracting foreign investment;
• Official Manufacturing Purchasing Managers’ index (PMI) and Caixin China General Manufacturing PMI in June;
• Industrial profits from January to May;

Also, listeners are invited to join an event in Beijing on the development of artificial intelligence (AI) to discuss the challenges and future trends of the AI industry.

Contact:

We’d love to hear your feedback. Contact us at website@europeanchamber.com.cn.

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Read more:

Renewed calls for attracting foreign investment

http://www.news.cn/politics/leaders/20240626/6d078e9f4f534fbbaf5bd6635a23691c/c.html#:~:text=%E6%96%B0%E5%8D%8E%E7%A4%BE%E5%8C%97%E4%BA%AC6%E6%9C%882,%EF%BC%88%E4%BF%AE%E8%AE%A2%E8%8D%89%E6%A1%88%EF%BC%89%E3%80%8B%E3%80%82 

https://english.www.gov.cn/news/202407/01/content_WS6682a12dc6d0868f4e8e8be0.html

China Official PMI, June (NBS)

https://www.stats.gov.cn/sj/zxfb/202406/t20240630_1955251.html

Caixin China General Manufacturing PMI, June

https://www.pmi.spglobal.com/Public/Home/PressRelease/dbf0d2731415453f99fac0d7826e16ea

China, industrial profits, January-May (NBS)

https://www.stats.gov.cn/sj/zxfb/202406/t20240627_1955196.html

Chamber event: Panorama Seminar on the Development of Artificial Intelligence

https://www.europeanchamber.com.cn/en/upcoming-events/26248

Transcript:

XINHE: Hello and welcome to China ShortCuts,

RUI: the European Chamber’s weekly catchup on China’s business landscape.

XINHE: This episode was recorded on 3^rd July 2024.

(MUSIC)

XINHE: On 26^th June, China’s State Council reiterated the need for increased efforts to attract and stabilise foreign investment.

RUI: At the executive meeting, chaired by Chinese premier Li Qiang, the State Council underscored the important role that foreign-invested enterprises play in “building a new development pattern”. The meeting called for further opening up of key areas, and listed removing access restrictions on foreign investment in the manufacturing sector and launching new pilot measures for promoting further opening up in the service industry as concrete steps to be taken. The State Council said it is necessary to ensure that both domestic and foreign-invested firms can participate in government procurement without discrimination.  Specific sectors in which optimisation of foreign investment policies is being urged are pharmaceuticals and medical devices. The meeting also highlighted the need for updating the Catalogue of Encouraged Industries for Foreign Investment, which was last revised in 2022.

XINHE: During a symposium on foreign investment, held on 1^st July, Chinese Vice Premier He Lifeng also emphasised the importance of attracting more foreign capital into China, adding that channels should be provided for foreign firms to raise their concerns, and that the relevant Chinese authorities should respond promptly. [MN1] 

(MUSIC)

XINHE: According to data released by the National Bureau of Statistics on 30^th June, manufacturing activity in China shrank for the second consecutive month, while growth in services activity slowed in June.

RUI: The official manufacturing purchasing managers’ index, or PMI, was unchanged from May at 49.5 points. Readings below the 50-point benchmark indicate contraction. While manufacturing production continued to expand in June, new orders dropped further, resulting in firms decreasing further both their raw material inventories and their staffing levels.

The headline index for non-manufacturing, which includes the services and construction sectors, indicated the lowest rate of growth all year at 50.5 points. The expansion in construction activity was the slowest recorded in the past eleven months. Services growth also fell to a five-month low. Both indices were primarily dragged down by weak demand and shrinking employment levels.

(MUSIC)

XINHE: A private survey conducted by Caixin and S&P Global showed the fastest improvement in business conditions in China’s manufacturing sector in over three years. The discrepancy with the official data from the statistics bureau is primarily due to the different sample size of the two surveys.

RUI: The Caixin manufacturing PMI rose to 51.8 points in June, indicating the fastest growth since May 2021. As new orders continued to rise, production also increased further, with output growth accelerating to the quickest pace in two years. Employment was broadly stable. While sentiment over the coming 12-months remained positive overall, the level of confidence is still the lowest for over four years, with surveyed manufacturers citing concerns over rising competition and uncertain market conditions.

(MUSIC)

XINHE: According to data released by the National Bureau of Statistics on 27^th June, in the first five months of 2024, profits at larger industrial firms in China increased 3.4 per cent compared to the same period last year.

RUI: While profits grew in the January-May period, the pace of growth has been on a continuous decline from a 10.2 per cent high-point recorded in the first two months of the year. In May alone, the year-on-year growth was only 0.7 per cent. Out of the three main industrial sectors of mining, manufacturing, and energy and utilities production and supply, profits increased steeply among the last group, while mining companies experienced a fall in profits surpassing 16 per cent.

(MUSIC)

XINHE: Artificial intelligence, especially generative AI, is gradually becoming a new engine for economic development, playing a key role in global technological innovation that is reshaping various industries. On 13^th July 2023, China issued its first regulations on generative AI, the Interim Measures for the Administration of Generative AI Services.

RUI: Join us on 13^th July, the first anniversary of the release of the Interim Measures, to hear experts, lawyers, consulting institutions and representatives from industries discuss in depth the challenges and future trends of the AI industry.

XINHE: Please note that the event will be held in Chinese with word translation service provided in English using Teams live captions.

(MUSIC)

RUI: Thanks for listening, and don’t forget to tune in again next week.

XINHE: In the meantime, please find useful links in the episode notes.